Services Marketing - Australian Bottled Water Industry Essay

In terms of bottled water there are a lot of substitutes and it can be difficult to capture a targeted market and retain them as consumers have many similar products to choose from.

The bulky and relatively low value of the product as well as the high costs of transport mean that the manufacturing and distribution plants need to be located where there are major population centres. The Australian bottled water manufacturing industry is currently in a growth stage. Growth has been achieved due to the increase in per capita consumption of bottled water, albeit from a relatively low base compared with other more established beverages. As consumers become more health conscious and change their drinking habits away from CSDs to healthier beverages, bottled water would increasingly become their drink of choice.

d. Demographics (what is the industry’s focus customer) Another significant trend is product marketing and packaging. Realizing that consumers cite taste, quality, and purity as the top reasons for drinking bottled water, bottlers market and design bottles to display their purity. Other manufacturers seek to carve out a new level in the bottled water industry introducing high-end products. Another packaging trend in the bottled water industry is multi-packs. As current bottled water consumption grows, more consumers are turning to multi-packs to save time and money.

“This is a story about a world obsessed with stuff. It 's a story about a system in crisis. We are trashing the planet, we are trashing each other, and we 're not even having fun”. This quote by writer; Annie Leonard, in her video The Study of Water explains how companies such as Coca-Cola and Pepsi used manufactured demand to get Americans to buy more than half a billion bottles a week (Leonard, 2010). In the late 1970s, giant soft drink companies such as PepsiCo, Coca-Cola, Nestle, and DANONE used manufactured demand in order to get the general public to drink to their bottled water. However, it was did not do so well in the beginning at all. With the introduction of Perrier in the United States in the late 1960s, bottled was seen as a upper class fad that only middle class to upper class adults would drink instead of their regular tap water. People used to say, “Water is free, what will they sell us next air”? But due to manufactured demand these companies were able to successfully make individuals purchase bottle water with cheap tactics. For example, one of the first marketing tactic to scare people away from tap water was from Fiji Water, in which they placed many ads in Cleveland that announced that its water will taste better than the regular city tap (Leonard, 2010). This placement, like many others, were used to basically give tap water a bad image. That drinking water from the bottle is one of the more pure forms of consuming water then going to

The thirsty customer who enters a convenience store will be faced with a variety of choices for bottled water. Decorative labels, purity claims, and price points are all carefully calculated to entice the consumer to select a particular brand.

Many people across the world choose to buy bottled water, not so many realise the adverse effects this practice has on the environment. Anthropocentric thinking as a result of modernity has led humans to see themselves as superior to the natural world (Jones, 2010). From 2014 to 2015 the number of Australians consuming bottled water rose from 4.9 million per week to 5.3 million per week (Australian Food News, 2016). The effects of bottled water consumption have severe impacts on natural water consumption, leads to excess product consumption and waste management issues.

Worldwide trends of bottled water are increasing in recent years impacting various regions of the globe. Researchers noticed the links made between obesity problem in the West and increased consumption of soft drinks reinforce the growth of bottled water, therefore, Americans are turning towards bottled water to fill their needs. North America, in particular, the United States usage of bottled water continues to accelerate at rapid rates. Millions of Americans prefer bottled water for hydration, which is becoming a substitution instead of tap water.

“We are a 24/7 on-the-go society who wants convenience in our beverage choices”. Kim E. Jeffery, CEO of Nestle Waters North company, made this comment in representation of the largest leader in the bottled water industry. It is no wonder how bottled water became so popular in our society. Healthier than soda, bottled water is conveniently stored in a lightweight, disposable, plastic bottle. Bottled water sales started when Perrier glass bottled water came overseas to America in the late 1970’s and in 1989, water was available in PET plastic bottles (Tapped). Now everywhere, bottled water can even be found in high school cafeterias while there are water fountains located in nearly every hall. However, there is an opposing view to the product with names such as Ice Mountain, Aquafina, Dasani, Sam’s Choice, and Acadia. Through research, bottled water is known to carry human pollutants, exceed other natural resource costs, and take part in a large portion of plastic waste, all in a sixteen ounce plastic bottle. Although bottled water is convenient in only a few cases, public education and legislation are necessary because of the human pollutants, costs, and waste.

The understanding of people choosing bottled water even though tap water is healthier and cheaper can be explained using the symbolic interactionism theory. “Symbolic interaction theory analyzes society by addressing the subjective meanings that people impose on objects, events, and behaviors (source)” These meanings are based on people’s behavior and not always what is true. An American sociologist, George Herbert Mead, was the founder of this theory around 1920s. In 1960, this theory became one of the prominent theories of sociology. In addition to the symbolic interactionism theory, George Herbert Mead was also a founder of American pragmatism and one of the founders of social psychology. Symbolic interactionist often focuses on the micro level of society. It focuses on how the meanings of objects, people, places, etc. constructs the world around us. Interactionist stressed the understanding of social life by taking the places of individuals or groups. “By the 1980s mainstream sociology had accepted much of the core of the symbolic interactionist approach, with its emphases on meaning, agency, and the interpretive analysis of interactional processes, as a legitimate and central part of the discipline (source).”

Many of us mindlessly drink bottled water each day, not thinking about the greater impact of that action. However, whether we know it or not, every drink affects the economy, the environment, and much, much more. Bottled water can be found at just about every supermarket in the U.S., and for good reason. It is the most popular drink in the world, surpassing even soda, and it boosts the economy by $21.3 billion each year. (Fottrell, 22 Sept. 2017) Bottled water companies have created jobs and assisted in rebuilding infrastructure, and they have donated water after natural disasters. However, along with the good created by bottled water, it presents significant environmental challenges. The industry uses 1.5 million tons of plastic each year to package water, thereby releasing carbon emissions into the air. Also, despite the perception that bottled water is healthier than tap water, according to the World Wildlife Fund, it may not be any safer than tap water. (Schriever, 30 Aug. 2013) For these reasons, among others, the viability of the bottled water industry has been questioned, and solutions that allow for the positive economic and ethical effects of bottled water, but negate the negative environmental and ethical effects, are being called for. However, in order for the general public to objectively evaluate solutions to this major issue, it is imperative that they understand the facts concerning the rise of bottled water and the specific environmental impacts of its

It is important to realize that Americans spend billions of dollars on bottled water. If a household of four purchased four bottles of water each day that would equal out to be $1450 dollars yearly. However, there are some individuals that would never consider the purchase of a bottled water. For instance, 20 years ago, my grandfather growled when we purchased bottled water to him it was like paying for air. The idea of paying for water remains offensive to many people, because too many it may say glacier fresh mountain water, but it’s the same tap water that runs from your kitchen sink.

A Bottled Water survey done by Mintel, in spring of 2015, found mid-priced brands show the highest market penetration. 68% of bottled water drinkers surveyed by Mintel say that they usually drink mid-priced brands. More than half of those surveyed said they usually drink value brands, showing a definite consumer preference towards mid-and value-priced brands on the market. Only 13% of those surveyed drank Premium water. (Mintel Group Ltd. 2015)

The UK public have increasingly been considering health and wellness, partly inspired by the 2012 Olympics and other campaigns to eat better and be more active. This means that health worries and price will potentially lead to an increase in consumers switching to bottled water, and in my opinion Evian’s health claims should help it remain in the market leader position.

Evian, Volvic, Aquafina, Hawaiian Springs, or Fiji, ring a bell? These are the names of famous bottled water brands. Nowadays, bottled water is extremely popular in America. Approximately, 85 million bottles of water are consumed every day in the United States (Gleick IX). The reason being that bottled water is convenient, reasonable, and seems healthy. However, the disadvantages of using bottled water outweigh its benefits; therefore consumers should refrain from buying bottled water.

The product ‘Bling H2O’ was developed by Kevin Boyd who aimed to develop a luxury bottled water product that had an ‘exquisite face to match exquisite taste’ (website), stating that the product ‘is strategically positioned to target the expanding super-luxury consumer market’ (website). Bling H2O has adopted micromarketing to target specific consumers through one-on-one marketing based on market segmentation, product positioning, and consumer buying behaviour; this can also be adapted to Australian consumers.